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ASSET BUILDING FOR HOUSEHOLDS - YELLAN SPEAKS

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ASSET BUILDING FOR HOUSEHOLDS - YELLAN SPEAKS

Sept 18 2014, 4.30 pm GMT

Stock.com

Chair of the Fed, Janet Yellan’s speech entitled the "The Importance of Asset Building for Low and Middle Income Households”, took into account the recession’s impact on US household reserves and saving. At the 2014 Assets Learning Conference of the Corporation for Enterprise Development, Washington, D.C., Yellen cited figures from the Federal Reserve's 2013 Survey of Consumer Finances, published earlier this month. The lowest fifth of families were reported to have a median net worth of only $6,400, the next fifth had median net worth of just $27,900. Negative equity or falling value in the house market has caused the major decrease in family’s assets and Yellan proposed diversity in assets as a way to gain better potential assets. She added, ‘A larger lesson from the financial crisis, of course, is how important it is to promote asset-building, including saving for a rainy day, as protection from the ups and downs of the economy.’
Addressing American citizens, Yellen said, ‘The Federal Reserve's mission is to promote a healthy economy and strong financial system, and that is why we have promoted and will continue to promote asset-building. One way we do this is through the Community Development programs at each of our 12 Reserve Banks, and through the Federal Reserve Board's Division of Consumer and Community Affairs in Washington. As a research institution, and a convener of stakeholders involved in community development, I believe the Fed can help you in carrying out your mission, to encourage families to take the small steps that over time can lead to the accumulation of considerable assets.’

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